The Special Tribunal has declared that the National Lotteries Commission’ (NLC) decision to award a R4 million grant to non-profit organisation (NPO) Mshandukani Foundation unlawful, reviewing and setting it aside.
The Tribunal has also ruled that the funds be repaid, including interest.
The Special Investigating Unit (SIU) had investigated the funding, which found irregularities in the awarding as well as use of the funds.
“[The] investigation… revealed that the funding application was based on a [borehole] project that had already been completed several years earlier and that the grant funds were diverted to entities linked to the foundation’s leadership.
“The SIU’s investigation found that the Mshandukani Foundation, a registered non-profit organisation (NPO), applied in February 2019 for grant funding of R4 708 000 to implement a community development project aimed at providing clean water to communities in the Eastern Cape.
“The application, signed by the Mshandukani Foundation’s Chairperson, Pretty Shandukani, to the NLC indicated that the project would benefit 8015 vulnerable people and create 15 part-time jobs. It also included operational costs such as salaries, stipends, audit fees, bank charges and travel expenses,” the SIU explained.
The funding was approved by former NLC Chief Operating Officer Phillemon Letwaba and was further distributed to various individuals and organisations including some R3.6 million paid to Preldon Construction CC, a company owned by Pretty Mshandukani.
“From the R3.6 million, R500 000 was paid… to Ironbridge Travelling Agency and Events (Pty) Ltd, a company owned by Mr Letwaba’s wife, Ms Rebotile Malomane, and R550 000 was paid… to Mshandukani Holdings, purportedly as a loan.
“Furthermore, Preldon Construction made several payments of R700 000 to Mshandukani Foundation, R2.1 million to Mshandukani Holdings, R150 000 to an associate, and R120 000 to Mr Mshandukani’s personal account. Additionally, R39 675 was paid to Rocbit Drilling Equipment,” the SIU said.
The investigation also found:
- The borehole work itself was of poor quality.
- Engcobo Local Municipality had no legal authority over the schools and clinics because responsibility for water services rests with the Chris Hani District Municipality.
- Mshandukani Foundation lacked the necessary approvals under the South African Schools Act and had failed to consult the Department of Basic Education, as required.
“The SIU also discovered that two employees of Mshandukani Holdings, a geologist intern and a receptionist, had been listed as members of the foundation without their knowledge or consent.
“The SIU found that neither the foundation, Mr Letwaba, Ironbridge Travelling Agency and Events, nor Ms Malomane had provided any explanation for how the grant funds were used,” the corruption busting unit added.
The SIU was authorised to investigate allegations of corruption and maladministration at the NLC through Proclamation R32 of 2020 signed by President Cyril Ramaphosa. – SAnews.gov.za
